Landowners across Iowa are busy making final arrangements for the upcoming growing season. And while there may still be snow outside your window, the green grass and smells of spring air aren’t too far off!

President Donald Trump recently signed the U.S.-Mexico-Canada Agreement into law. In addition, trade delegations from the U.S. and China have worked out a Phase 1 agreement, which hopefully will lead to major purchases of U.S. ag products by China. Both trade agreements are hugely important demand-drivers for many, if not most, of the products we grow and raise here in Iowa. Their passage and implementation are very likely to be supportive to our grain markets in the near term and over the coming years.

Stronger grain markets are a major driver that underly the Iowa farmland market. I’ve said it many times over the past couple years: If we have enjoyed a generally stable farmland market, given all the negative news we’ve endured since early 2018, what will happen to land values if we have some significant good news enter the market?

These positive developments certainly should be supportive. Having said that, I’ll withhold any bold predictions until we see implementation of the agreed-to terms of these deals.

Keep eye on interest rates

Beyond trade optimism, low interest rates continue to support farmland purchases and values. The 10-year Treasury bill, which is often the bogey for long-term loan rate pricing, has been trading well under 2% since late last summer, and rates are close to a full percentage point lower than a year ago at this time. If you think 1% doesn’t make that much difference on a farmland loan, go run a loan calculator with different loan rates. I understand that 1% doesn’t sound like much, but it is indeed significant, especially in our current low rate environment.

There are also lots of major wild cards that remain in play for 2020: the upcoming presidential election, the various ongoing military conflicts across the globe, African swine fever, etc. There are many things that could upend our current land market stability.

And because of these wild cards, some would say it’s possible — and even somewhat likely — that we may experience a heightened level of volatility this year. But with these trade deals seemingly coming together, I personally hold a slightly more optimistic view of the land market for 2020, than I did even 60 to 90 days ago.

NORTHWEST

Buena Vista County. Near Albert City, 160 acres recently sold at public auction for $8,000 per acre. The farm consists of 156 tillable acres with an 87.5 CSR2, which equals $94 per CSR2 point on the tillable acres.

NORTH CENTRAL

Franklin County. Near Sheffield, 112 acres sold at public auction for $7,900 per acre. The farm consists of 108 tillable acres with an 84.1 CSR2, which equals $97 per CSR2 point on the tillable acres.

NORTHEAST

Black Hawk County. North of Waterloo, 70 acres sold for $5,012 per acre. The farm has 69 tillable acres (42 crop and 27 in CRP), with an 87.5 CSR2, which equals $60 per CSR2 point on the tillable acres.

WEST CENTRAL

Carroll County. North of Carroll, 114 acres sold at public auction for $10,600 per acre. The farm has 96 tillable acres with an 81.2 CSR2, which equals $155 per CSR2 point on the tillable acres.

CENTRAL

Webster County. East of Moorland, 87 acres sold at public auction for $9,200 per acre. The farm has 85 tillable acres with an 82.7 CSR2, which equals $114 per CSR2 point on the tillable acres.

EAST CENTRAL

Iowa County. Near Amana, 159 acres sold for $10,500 per acre. The farm consists of 149 tillable acres with an 87.9 CSR2, which equals $127 per CSR2 point on the tillable acres.

SOUTHWEST

Fremont County. East of Sidney, 103 acres sold at public auction for $8,000 per acre. The farm has 99 tillable acres with a 92.8 CSR2, which equals $90 per CSR2 point on the tillable acres.

SOUTH CENTRAL

Madison County. South of Winterset, 77 acres sold for $7,792 per acre. The farm consists of 69 tillable acres with an 83.2 CSR2, which equals $105 per CSR2 point on the tillable acres.

SOUTHEAST

Davis County. East of Bloomfield, 73 acres sold at public auction for $7,000 per acre. The farm consists of 67 tillable acres with a 56.1 CSR2, which equals $136 per CSR2 point on the tillable acres.

Hensley is president of Hertz Real Estate Services which compiled this list but did not handle all sales. Visit hertz.ag.